Written by

Detroit Free Press Staff Writer

As the proposal for a new Red Wings arena forges ahead, several community stakeholders are pursuing a deal to help ensure the $450-million project provides jobs for Detroiters and does not disrupt neighborhoods surrounding the arena site near downtown.

They want the arena’s developer, Olympia Development of Michigan, an Ilitch family company, to reach a community benefits agreement that could include provisions to regulate hiring practices, protect homeowners near the arena from being displaced and set environmental standards.

Such agreements are necessary to hold accountable professional sports teams and their owners who enjoy publicly subsidized arenas and stadiums, said Francis Grunow, with Corridors Alliance, a community organization.

“We want to hold the development to a higher standard,” Grunow said. “As time has gone on, there’s been more and more public money included in these projects.”

The new hockey arena is to be built on an eight-block stretch of the Cass Corridor mostly populated with abandoned buildings and vacant lots. As proposed, construction of the arena would be 58% publicly funded and 42% privately funded. No Detroit general fund dollars would be spent; the state is contributing the bulk of the public investment.

The proposal includes plans for a $200-million private, spin-off development nearby that includes residential, retail and office facilities.

Altogether, the $650-million development is projected to create thousands of jobs and boost the local economy with an influx of new businesses surrounding the 18,000-seat hockey arena that could open in 2017.

The arena would be owned by the quasi-public Detroit Downtown Development Authority and operated by Olympia Development of Michigan. Olympia would keep all revenues from the arena’s operations, including parking fees and concessions sales.

Community benefits agreements are in place for other arena projects, Grunow said, including Pittsburgh’s Consol Energy Center where the Pittsburgh Penguins play and the Staples Center in Los Angeles.

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In Pittsburgh, the agreement has helped keep residential rent costs down and has prevented unbridled development around the arena, said Curt Conrad, a community organizer with the Hill District Consensus Group, which helps monitor the agreement.

“If that document wasn’t in place, it’d be very likely that they could develop the area around the Energy Center as they please,” Conrad said.

Olympia and the DDA have agreed to hire Detroit residents for at least 51% of the jobs tied to the arena project. But Grunow said a community benefits agreement could establish a process to monitor that employment target.

Although the project has progressed quickly in recent months, a crucial transfer of public land for the project remains before the City Council for approval.

The council has scheduled a public hearing on the land transfer at council chambers at 5 p.m. Wednesday.

Councilwoman Raquel Castaneda-Lopez has been in talks with the developer to explore including a community benefits agreement in the land transfer.

Specifics of a possible agreement have not been finalized, she said in an e-mail.

“Generally speaking, with any type of development, it’s important to engage the community in talks from the start since residents in the surrounding area will be the most impacted by the project,” Castaneda-Lopez said. “Unfortunately the trend is to engage the community as an afterthought, if at all. Moving forward, the community should be considered an equal player at the negotiating table as opposed to an afterthought. As a council, we are working to shift this paradigm via the creation of a community benefits ordinance.”

John Hahn, a representative of Ilitch Holdings, confirmed Monday that the talks are ongoing.